Wayland custom woodworking payroll project answers

Question 1)
Required information
[The following information applies to the questions displayed below.]

Wayland Custom Woodworking is a firm that manufactures custom cabinets and woodwork for business and residential customers. Students will have the opportunity to establish payroll records and to complete a month of payroll information for Wayland. Wayland Custom Woodworking is located at 1716 Nichol Street, Logan, Utah, 84321, phone number 435-555-9877. The owner is Mark Wayland. Wayland’s EIN is 91-7444533, and the Utah Employer Account Number is 999-9290-1. Wayland has determined it will pay their employees on a semimonthly basis. Federal income tax should be computed using the percentage method.

For Part 1 of this project, you will complete payroll for the last month (December) of the fourth quarter (Q4) of 2016, which consists of the final two pay periods of the year. Once payroll has been completed for the fourth quarter, you will then file the annual tax forms for Wayland as well as prepare each employee's Form W-2 in Part 2.

The SUTA (UI) rate for Wayland Custom Woodworking is 2.6% on the first $32,200. The state withholding rate is 5.0% for all income levels and marital statuses, which will be used in computing Utah withholding tax for each employee using the tax tables provided below.

Rounding can create a challenge. For this project, the hourly rate for the individuals should be rounded to five decimal places. So take their salary and divide by 2,080 (52 weeks at 40 hours per week) for all full time employees, both exempt and nonexempt. For nonexempt employees, such as Stevon Varden, Varden’s salary is $42,000 and is a nonexempt employee, so the calculation will be $42,000/2,080, which would give you $20.19231 per hour, and use this to compute the employee’s gross pay based on the number of hours worked. When a nonexempt employee has worked overtime hours for a given pay period, take their regular hourly rate and multiply it by 1.5, round the result to 5 decimal places, and multiply the new rate by their number of overtime hours.

For exempt employees, such as Anthony Chinson, an hourly rate rounded to five decimal places should be determined using the same method shown above, but gross pay should be determined by taking the exempt employee’s yearly salary and dividing it by 24, which is the number of payroll periods with a semimonthly frequency. For example, Chinson’s salary is $24,000 and is a full time employee. Chinson’s hourly rate is $11.53846(determined by taking $24,000/2,080), but as he is an exempt employee, the calculation for his gross pay will be $24,000/24, which would give you $1,000. For pay periods that include paid holidays, ensure to distribute an exempt employee's regular pay accordingly to holiday pay based on the number of hours that consist of the holidays for that period.

Employees are paid for the following holidays occurring during the final quarter:

· Thanksgiving day and the day after, Thursday and Friday November 24-25

· Christmas, which is a Sunday. When holidays occur on a weekend, the preceding Friday, December 23, is considered a holiday. Employees receive holiday pay for Monday, December 26.

For the completion of this project, refer to the tax-related information in the table below. For federal withholding calculations, use the percentage method tables in Appendix C, which is provided below. For Utah state withholding calculations, use the Utah Schedule 3 tax tables linked below (ensure to use the appropriate Utah table based on each employee's marital status). Both 401(k) and insurance are pretax for federal income tax and Utah income tax.

Federal Withholding Allowance (less 401(k), Section 125)

$168.80 per allowance claimed

Semimonthly Federal Percentage Method Tax Table

Appendix C Page 254 Table #3

Federal Unemployment Rate (employer only) (less Section 125)

0.6% on the first $7,000 of wages

State Withholding Rate (less 401(k), Section 125)

See Utah Schedule 3, Table 1 or use the Excel Version of Schedule 3

State Unemployment Rate (employer only) (less Section 125)

2.6% on the first $32,200 of wages

The balance sheet for WCW as of November 30, 2016, is as follows:

Wayland Custom Woodworking Balance Sheet 11/30/2016

Assets

Liabilities & Equity

Cash

$

1,086,269.51

Accounts Payable

$

150,230.89

Supplies

10,283.15

Salaries and Wages Payable

10,319.19

Office Equipment

130,202.16

Federal Unemployment Tax Payable

1,920.92

Inventory

221,163.81

Social Security Tax Payable

3,219.22

Vehicle

25,000.00

Medicare Tax Payable

752.88

Accumulated Depreciation, Vehicle

(1,420.00)

Federal Unemployment Tax Payable

92.32

Building

164,000.00

State Unemployment Tax Payable

674.99

Accumulated Depreciation, Building

(3,221.00)

Employee State Income Tax Payable

1,088.86

Land

35,750.00

401(k) Contributions Payable

1,018.66

Total Assets

1,668,027.63

Employee Medical Premiums Payable

750.00

Notes Payable

211,000.00

Utilities Payable

2,825.43

Total Liabilities

383,893.36

Owners' Equity

1,250,000.00

Retained Earnings

34,134.27

Total Equity

1,284,134.27

Total Liabilities and Equity

1,668,027.63

October 1:

Wayland Custom Woodworking (WCW) pays its employees according to their job classification. The following employees comprise Wayland’s staff:

Employee Number

Name and Address

Payroll information

00-Chins

Anthony Chinson

Married, 1 Withholding allowance

530 Sylvann Avenue

Exempt

Logan, UT 84321

$24,000/year + commission

435-555-1212

Start Date: 10/1/2016

Job title: Account Executive

SSN: 511-22-3333

00-Wayla

Mark Wayland

Married, 5 withholding allowances

1570 Lovett Street

Exempt

Logan, UT 84321

$75,000/year

435-555-1110

Start Date: 10/1/2016

Job title: President/Owner

SSN: 505-33-1775

01-Peppi

Sylvia Peppinico

Married, 7 withholding allowances

291 Antioch Road

Exempt

Logan, UT 84321

$43,500/year

435-555-2244

Start Date: 10/1/2016

Job title: Craftsman

SSN: 047-55-9951

01-Varde

Stevon Varden

Married, 2 withholding allowances

333 Justin Drive

Nonexempt

Logan, UT 84321

$42,000/year

435-555-9981

Start Date: 10/1/2016

Job title: Craftsman

SSN: 022-66-1131

02-Hisso

Leonard Hissop

Single, 4 withholding allowances

531 5th Street

Nonexempt

Logan, UT 84321

$49,500/year

435-555-5858

Start Date: 10/1/2016

Job title: Purchasing/Shipping

SSN: 311-22-6698

00-Succe

Student F Success

Single, 1 withholding allowance

1650 South Street

Nonexempt

Logan, UT 84321

$36,000/year

435-556-1211

Start Date: 10/1/2016

Job title: Accounting Clerk

SSN: 555-55-5555

Voluntary deductions for each employee are as follows:

Name

Deduction

Chinson

Insurance: $50/paycheck

401(k): 3% of gross pay

Wayland

Insurance: $75/paycheck

401(k): 6% of gross pay

Peppinico

Insurance: $75/paycheck

401(k): $50 per paycheck

Varden

Insurance: $50/paycheck

401(k): 4% of gross pay

Hissop

Insurance: $75/paycheck

401(k): 3% of gross pay

Student

Insurance: $50/paycheck

401(k): 3% of gross pay

The departments are as follows:

Department 00: Sales and Administration

Department 01: Factory workers

Department 02: Delivery and Customer service

You have been hired as of October 1 as the new accounting clerk. Your employee number is 00-SUCCE. Your name is Student F Success. Your address is 1650 South Street, Logan, UT 84321. Your phone number is 435-556-1211, you were born July 16, 1985, your Utah driver's license number is 887743 expiring in 7/16/2018, and your Social Security number is 555-55-5555. You are considered a nonexempt employee, have one withholding allowance, and paid a rate of $36,000 per year.

For additional instructions on how to navigate and work through through Part 1 of this project, please download the student project guide here.

rev: 01_11_2017_QC_CS-74391

Required:

1. Complete the W-4 and, using the given information, complete the I-9 form to start your employee file. Complete it as if you are single with one withholding, you contribute 3% to a 401(k), and health insurance is $50 per pay period. The following file provides the lists of acceptable documents for Form I-9.

(NOTE): Further instructions on format can be found on certain cells within the forms. Employer I9 PG 2 Section should also be completed.

Question 2) Required information
[The following information applies to the questions displayed below.]

Wayland Custom Woodworking is a firm that manufactures custom cabinets and woodwork for business and residential customers. Students will have the opportunity to establish payroll records and to complete a month of payroll information for Wayland. Wayland Custom Woodworking is located at 1716 Nichol Street, Logan, Utah, 84321, phone number 435-555-9877. The owner is Mark Wayland. Wayland’s EIN is 91-7444533, and the Utah Employer Account Number is 999-9290-1. Wayland has determined it will pay their employees on a semimonthly basis. Federal income tax should be computed using the percentage method.

For Part 1 of this project, you will complete payroll for the last month (December) of the fourth quarter (Q4) of 2016, which consists of the final two pay periods of the year. Once payroll has been completed for the fourth quarter, you will then file the annual tax forms for Wayland as well as prepare each employee's Form W-2 in Part 2.

The SUTA (UI) rate for Wayland Custom Woodworking is 2.6% on the first $32,200. The state withholding rate is 5.0% for all income levels and marital statuses, which will be used in computing Utah withholding tax for each employee using the tax tables provided below.

Rounding can create a challenge. For this project, the hourly rate for the individuals should be rounded to five decimal places. So take their salary and divide by 2,080 (52 weeks at 40 hours per week) for all full time employees, both exempt and nonexempt. For nonexempt employees, such as Stevon Varden, Varden’s salary is $42,000 and is a nonexempt employee, so the calculation will be $42,000/2,080, which would give you $20.19231 per hour, and use this to compute the employee’s gross pay based on the number of hours worked. When a nonexempt employee has worked overtime hours for a given pay period, take their regular hourly rate and multiply it by 1.5, round the result to 5 decimal places, and multiply the new rate by their number of overtime hours.

For exempt employees, such as Anthony Chinson, an hourly rate rounded to five decimal places should be determined using the same method shown above, but gross pay should be determined by taking the exempt employee’s yearly salary and dividing it by 24, which is the number of payroll periods with a semimonthly frequency. For example, Chinson’s salary is $24,000 and is a full time employee. Chinson’s hourly rate is $11.53846 (determined by taking $24,000/2,080), but as he is an exempt employee, the calculation for his gross pay will be $24,000/24, which would give you $1,000. For pay periods that include paid holidays, ensure to distribute an exempt employee's regular pay accordingly to holiday pay based on the number of hours that consist of the holidays for that period.

Employees are paid for the following holidays occurring during the final quarter:

· Thanksgiving day and the day after, Thursday and Friday November 24-25

· Christmas, which is a Sunday. When holidays occur on a weekend, the preceding Friday, December 23, is considered a holiday. Employees receive holiday pay for Monday, December 26.

For the completion of this project, refer to the tax-related information in the table below. For federal withholding calculations, use the percentage method tables in Appendix C, which is provided below. For Utah state withholding calculations, use the Utah Schedule 3 tax tables linked below (ensure to use the appropriate Utah table based on each employee's marital status). Both 401(k) and insurance are pretax for federal income tax and Utah income tax.

Federal Withholding Allowance (less 401(k), Section 125)

$168.80 per allowance claimed

Semimonthly Federal Percentage Method Tax Table

Appendix C Page 254 Table #3

Federal Unemployment Rate (employer only) (less Section 125)

0.6% on the first $7,000 of wages

State Withholding Rate (less 401(k), Section 125)

See Utah Schedule 3, Table 1 or use the Excel Version of Schedule 3

State Unemployment Rate (employer only) (less Section 125)

2.6% on the first $32,200 of wages

The balance sheet for WCW as of November 30, 2016, is as follows:

Wayland Custom Woodworking Balance Sheet 11/30/2016

Assets

Liabilities & Equity

Cash

$

1,086,269.51

Accounts Payable

$

150,230.89

Supplies

10,283.15

Salaries and Wages Payable

10,319.19

Office Equipment

130,202.16

Federal Unemployment Tax Payable

1,920.92

Inventory

221,163.81

Social Security Tax Payable

3,219.22

Vehicle

25,000.00

Medicare Tax Payable

752.88

Accumulated Depreciation, Vehicle

(1,420.00)

Federal Unemployment Tax Payable

92.32

Building

164,000.00

State Unemployment Tax Payable

674.99

Accumulated Depreciation, Building

(3,221.00)

Employee State Income Tax Payable

1,088.86

Land

35,750.00

401(k) Contributions Payable

1,018.66

Total Assets

1,668,027.63

Employee Medical Premiums Payable

750.00

Notes Payable

211,000.00

Utilities Payable

2,825.43

Total Liabilities

383,893.36

Owners' Equity

1,250,000.00

Retained Earnings

34,134.27

Total Equity

1,284,134.27

Total Liabilities and Equity

1,668,027.63

October 1:

Wayland Custom Woodworking (WCW) pays its employees according to their job classification. The following employees comprise Wayland’s staff:

Employee Number

Name and Address

Payroll information

00-Chins

Anthony Chinson

Married, 1 Withholding allowance

530 Sylvann Avenue

Exempt

Logan, UT 84321

$24,000/year + commission

435-555-1212

Start Date: 10/1/2016

Job title: Account Executive

SSN: 511-22-3333

00-Wayla

Mark Wayland

Married, 5 withholding allowances

1570 Lovett Street

Exempt

Logan, UT 84321

$75,000/year

435-555-1110

Start Date: 10/1/2016

Job title: President/Owner

SSN: 505-33-1775

01-Peppi

Sylvia Peppinico

Married, 7 withholding allowances

291 Antioch Road

Exempt

Logan, UT 84321

$43,500/year

435-555-2244

Start Date: 10/1/2016

Job title: Craftsman

SSN: 047-55-9951

01-Varde

Stevon Varden

Married, 2 withholding allowances

333 Justin Drive

Nonexempt

Logan, UT 84321

$42,000/year

435-555-9981

Start Date: 10/1/2016

Job title: Craftsman

SSN: 022-66-1131

02-Hisso

Leonard Hissop

Single, 4 withholding allowances

531 5th Street

Nonexempt

Logan, UT 84321

$49,500/year

435-555-5858

Start Date: 10/1/2016

Job title: Purchasing/Shipping

SSN: 311-22-6698

00-Succe

Student F Success

Single, 1 withholding allowance

1650 South Street

Nonexempt

Logan, UT 84321

$36,000/year

435-556-1211

Start Date: 10/1/2016

Job title: Accounting Clerk

SSN: 555-55-5555

Voluntary deductions for each employee are as follows:

Name

Deduction

Chinson

Insurance: $50/paycheck

401(k): 3% of gross pay

Wayland

Insurance: $75/paycheck

401(k): 6% of gross pay

Peppinico

Insurance: $75/paycheck

401(k): $50 per paycheck

Varden

Insurance: $50/paycheck

401(k): 4% of gross pay

Hissop

Insurance: $75/paycheck

401(k): 3% of gross pay

Student

Insurance: $50/paycheck

401(k): 3% of gross pay

The departments are as follows:

Department 00: Sales and Administration

Department 01: Factory workers

Department 02: Delivery and Customer service

You have been hired as of October 1 as the new accounting clerk. Your employee number is 00-SUCCE. Your name is Student F Success. Your address is 1650 South Street, Logan, UT 84321. Your phone number is 435-556-1211, you were born July 16, 1985, your Utah driver's license number is 887743 expiring in 7/16/2018, and your Social Security number is 555-55-5555. You are considered a nonexempt employee, have one withholding allowance, and paid a rate of $36,000 per year.

For additional instructions on how to navigate and work through through Part 1 of this project, please download the student project guide here.

rev: 01_11_2017_QC_CS-74391

Required:

2. Complete the payroll process for Wayland Custom Woodworking's last two pay periods of the fourth quarter. Please note that you must carry the ending balance from each account in the December 15 General Ledger to the following period's General Ledger to the input boxes titled "Ending account balance from the prior period" before posting the payroll journal entries from the current period to the Ledger.

For additional instructions on how to carry information from one pay period General Ledger to another, along with a guided walkthrough example of this process, refer to the project user guide in the project information section above.

December 15

December 15 is the end of the first pay period for the month of December. Employee pay will be disbursed on December 19, 2016. Remember that the employees are paid on a semimonthly basis.

Compute the net pay and update the Employees' Earning Record with the December 15 pay and the new YTD information. Any hours worked in excess of 80 hours during this pay period are considered overtime for nonexempt employees.

· Complete the Employee Gross Pay tab.

· Complete the Payroll Register for December 15 Pay. Employee pay will be disbursed on December 19, 2016.

· Refer to the Employee Earning Record Forms for each employee for the current YTD amounts after you have completed the December 15 Payroll Register and update each EERF with the amounts from the current period. YTD amounts from the previous four pay periods of the fourth quarter are shown for each employee.

· Complete the General Journal entries for the December 15 payroll.

· Post the journal entries to the General Ledger. Amounts for the ledger accounts from the previous four pay periods of the fourth quarter are shown.

December 31

The final pay period of the year will not be paid to employees until January 3, 2017. The company will accrue the wages for the final pay period only. Since the pay period is complete, there will not be a reversing entry for the accrual. As a result, paychecks will not be issued for this pay period since they will be paid in the following year and reflected on the Employee Earning Record forms for each employee when paid.

The company pays for the day before and the day of Christmas, and if the holiday is on a weekend, the company pays for the Friday before. Christmas fell on a Sunday, so employees will be paid for both the Friday and Monday as holiday pay. Employees worked extra hours on Saturday during the week of 12/23-12/29. Reminder, holidays and vacations are not included as hours worked for calculation of overtime.

· Complete the Employee Gross Pay tab.

· Complete the Payroll Register for December 31.

· Complete the General Journal entries for the December 31 payroll.

· Update the General Ledger with the ending ledger balances from the December 15 pay period ledger accounts first, and then post the journal entries from the current period to the General Ledger.

Question 3)

Wayland Custom Woodworking is a firm that manufactures custom cabinets and woodwork for business and residential customers. Students will have the opportunity to establish payroll records and to complete a month of payroll information for Wayland. Wayland Custom Woodworking is located at 1716 Nichol Street, Logan, Utah, 84321, phone number 435-555-9877. The owner is Mark Wayland. Wayland’s EIN is 91-7444533, and the Utah Employer Account Number is 999-9290-1. Wayland has determined it will pay their employees on a semimonthly basis. Federal income tax should be computed using the percentage method. The SUTA (UI) rate for Wayland Custom Woodworking is 2.6% on the first $32,200. The state withholding rate is 5.0% for all income levels and marital statuses.

For Part 2 of this project, you will use the fourth quarter payroll information that you calculated in Part 1 to complete the following tax forms for Wayland Custom Woodworking:

· U.S. Form 941

· U.S. Form 940

· Utah Form TC-941

· Utah Form 33H

· Form W-2s for all 6 employees

· Form W-3 for WCW

Specific instructions on how to complete each form can be found within the individual forms themselves. The employee information for Wayland has been presented again below, for convenience.

Employee Number

Name and Address

Payroll information

00-Chins

Anthony Chinson

Married, 1 Withholding allowance

530 Sylvann Avenue

Exempt

Logan, UT 84321

$24,000/year + commission

435-555-1212

Start Date: 10/1/2016

Job title: Account Executive

SSN: 511-22-3333

00-Wayla

Mark Wayland

Married, 5 withholding allowances

1570 Lovett Street

Exempt

Logan, UT 84321

$75,000/year

435-555-1110

Start Date: 10/1/2016

Job title: President/Owner

SSN: 505-33-1775

01-Peppi

Sylvia Peppinico

Married, 7 withholding allowances

291 Antioch Road

Exempt

Logan, UT 84321

$43,500/year

435-555-2244

Start Date: 10/1/2016

Job title: Craftsman

SSN: 047-55-9951

01-Varde

Stevon Varden

Married, 2 withholding allowances

333 Justin Drive

Nonexempt

Logan, UT 84321

$42,000/year

435-555-9981

Start Date: 10/1/2016

Job title: Craftsman

SSN: 022-66-1131

02-Hisso

Leonard Hissop

Single, 4 withholding allowances

531 5th Street

Nonexempt

Logan, UT 84321

$49,500/year

435-555-5858

Start Date: 10/1/2016

Job title: Purchasing/Shipping

SSN: 311-22-6698

00-Succe

Student F Success

Single, 1 withholding allowance

1650 South Street

Nonexempt

Logan, UT 84321

$36,000/year

435-556-1211

Start Date: 10/1/2016

Job title: Accounting Clerk

SSN: 555-55-5555

If you have submitted Part 1 already, it is recommended that you access your submission while attempting Part 2, as you will need the information from Part 1 in order to complete all applicable tax forms.

For additional instructions on how to navigate and work through through Part 2 of this project, please download the student project guide here.

rev: 01_11_2017_QC_CS-74391

Required:

1. Complete Form 941 for the remittance of quarterly federal taxes.

Question 4)

Required information
[The following information applies to the questions displayed below.]

Wayland Custom Woodworking is a firm that manufactures custom cabinets and woodwork for business and residential customers. Students will have the opportunity to establish payroll records and to complete a month of payroll information for Wayland. Wayland Custom Woodworking is located at 1716 Nichol Street, Logan, Utah, 84321, phone number 435-555-9877. The owner is Mark Wayland. Wayland’s EIN is 91-7444533, and the Utah Employer Account Number is 999-9290-1. Wayland has determined it will pay their employees on a semimonthly basis. Federal income tax should be computed using the percentage method. The SUTA (UI) rate for Wayland Custom Woodworking is 2.6% on the first $32,200. The state withholding rate is 5.0% for all income levels and marital statuses.